Evergrande is a real estate behemoth based out of China with 1.5 million already sold but not yet completed residential units, according to a note by Invesco. The company’s presence, however, is not limited to real estate. Evergrande has an auto unit, online media platform, health food vertical, and even healthcare projects. With its sprawling business, the conglomerate has a ballooning debt problem.
On a more immediate basis, Evergrande has over $300 billion due for repayment to investors, lenders, and suppliers. “Evergrande Group’s total liability size is ~$313 billion, which is ~6.5% of the total liability of the Chinese property sector. In terms of total offshore bonds outstanding, Evergrande Group has ~$19 billion, which is equivalent to roughly 9% of the total offshore bond market and 12% of the total HY offshore bond market,” analysts at UBS wrote in a note last week. This was around the same time when China’s Ministry of Housing and Urban-Rural Development told banks that Evergrande would not be able to meet its debt obligations that started yesterday.
